The Swiss Franc declined against the dollar form its highest in two years as increase in the labor cost despite weakness in the productivity of US workers suggested that Fed would continue to prioritize inflation concerns over growth of the economy.
Swiss Re Stays Optimistic Despite Rising Bills
Natural disasters this summer are expected to weigh heavily on Swiss Re, costing the company about SFr1.21 billion ($1.02 billion) for the year as a whole. However, the world’s largest reinsurer by premiums says the outlook for the rest of the year remains strong, assuming an average level of natural catastrophes. The second half of each year is usually the costliest for reinsurers because of the United States hurricane season.
Novartis’s Gleevec Patent Challenge Rejected in India
Novartis AG said its challenge to Indian patent law over the country’s rejection of a patent on the best-selling cancer treatment Gleevec was turned down by a court. The Basel, Switzerland-based company challenged India’s legal basis for the rejection of a patent on Gleevec. The Indian government last year denied the application, saying the drug was insufficiently innovative. Novartis said it probably won’t appeal today’s decision to the country’s supreme court.
Migration Boss Seeks Clarity On Integration
The director of the Federal Migration Office, Eduard Gnesa, says Swiss cantons should pursue a “clear line” in integrating foreigners. Gnesa, who is head of a working group that will put recommendations to the government, told the SonntagsZeitung newspaper that the main focus should be on helping young foreigners. He said young foreigners had difficulty finding apprenticeships and jobs, and were more likely to commit crime. Gnesa said integration had to be improved first and foremost through existing structures. He added that the new law on foreigners, which includes instruments such as integration contracts, would help in this respect.
The Swiss Franc declined against the dollar form its highest in two years as increase in the labor cost despite weakness in the productivity of US workers suggested that Fed would continue to prioritize inflation concerns over growth of the economy. This prompted investors to resume carry trades. The Swiss currency is correcting off a recent six week high against its Japanese counterpart too. Upcoming Swiss unemployment rate is expected not to change and currently remains at 2.7%. As of 12:30pm the pair was trading at 1.1955.
Equity Market: Swiss Market Index
Swiss share prices closed higher ending four day continuous decline. The rally was mostly led by banks and other financials, with Swiss Re in focus after announcing a solid set of second-quarter results in line with market expectations. Credit Suisse jumped 4.6 percent whereas UBS was up 2.1 percent. The Swiss Market Index closed 107.09 points higher, at 8,746.97.
Fixed-Income Market: 10-Year Swiss Government Bonds
Bonds closed almost flat after experiencing a strong rally in the early hours of the day, with yields on 10-year Swiss government bond futures up slightly to 3.068 percent